Robert Gothan, CEO and founder of Accountagility – the leading solutions provider for the finance function 

For most businesses, ‘year-end’ and ‘wits’ end’ have become largely interchangeable. As CFOs wade through mountains of data that make Everest resemble a molehill, and Financial Directors glug down enough coffee to bankrupt Brazil, the end-of-year cycle leaves many wondering how they’ll get through.

Year-end can be stressful; the responsibility of bringing together 12 months of transactions, payments and accounts is certainly one of the more demanding tasks which a firm has to undertake. But while nobody is questioning the difficulty of the process,we must realise that many organisations can do more to avoid the year-end headache.

Avoiding errors

When it comes to managing company finances, few tools are as useful as the humble spreadsheet.

A myriad of perfectly ordered rows and columns, the spreadsheet is, on paper, a picture of efficiency. With the ability to store vast amounts of information, condense complex data into easy-to-read figures, and organise all of this into straightforward categories, spreadsheets are capable of fulfilling virtually any administrative task that a finance team requires of them.

But for all of its virtues, there is one shortcoming which even the spreadsheet cannot overcome: human error.

In many organisations, financial data is manually entered into spreadsheets by members of staff. At first glance, this doesn’t seem problematic; as long as the correct data is put into the correct grids, companies should find it easy to organise their accounts when year-end rolls around.

However, this assumption overlooks the complexities of business operations.Often, the information needed for individual accounts is spread across several departments, each of which is responsible for ensuring that data is recorded as it arrives.

Knowing this, one can already envisage many of the problems likely to arise from this model. Whether it involves one employee saving a database in a different folder to another, or one department putting the right information into the wrong file, spreadsheets can quickly become jumbled, and accounts can be littered with errors and absences.

This doesn’t take into account the difficulties associated with the ever-changing regulations to which financial managers must monitor and respond. New regulations are likely to increase in their complexity as the legislative repercussions of Brexitbegin to take shape.

Because they need extra time to ensure that their organisation complies with these regulatory demands,rushed finance teams are at risk to making errors when administrating their monthly accounts. As a result, the year-end process can become increasingly problematic for organisations.

Dispersing the gloom

Research shows that an astonishing 94% of companies perform an early close at the end of every month in order to leave time to respond to inevitable errors arising from their data. Over half of the CFOs and FDs surveyed claimed that time-consuming manual adjustments are a responsibility that they face every four weeks, while almost 45% raised concern over the streams of processing errors that have to be navigated on a monthly basis.

This research applies to the month-end cycle. Times this amount of data by 12, and it’s easy to see where frustrations arise.

Fail to prepare

To overcome their complete dependency on spreadsheets, many organisations are turning to automated solutions when managing their year-end accounts.Automation combines technology with cultural changes within an organisation, and is best understood as a ‘production line’ approach.

By using software that is capable of organising, editing and analysing financial data more efficiently than Excel and similar programmes, automation drastically reduces the need for firmsto crunch numbers, before going back to manually correct errors highlighted in the subsequent figures. In doing so, it removes many of the flaws associated with manually managed software, and streamlines the performance of an organisation’s overarching financial management.

Automation is not only useful for reducing the stress and wasted time associated with year-end. The accuracy of figures produced by financial automation provides finance teams with valuable insights into the areas where resources can be best placed in the upcoming year. In this respect, automation provides even wider-reaching benefits to employees, managers and organisations as a whole.

For all these reasons, if your organisation makes one resolution this financial new year, it should be to embrace new technology and cut down on the spreadsheets.Even if this change starts off as small, it won’t take long to feel the benefits of financial automation.

*Survey commissioned by Accountagility, ‘Putting Finance Departments in Control’ to 200 CFOs and FDs in September 2015